Is it just being primarily used as a DAP? If my friend told me "It's a lot more than an mp3 player" it becomes a negative to me, I don't want bells and whistles with my DAP (battery life shortened, everything is done "okay" rather than "great", the list goes on).

If you want better sound quality, Samsung's P3 is either here or coming very soon. Cowon S9 has better sound quality (by a freaking mile) and uses an OLED screen. It beats the iPod touch in almost every aspect. iPod will usually always wins with 3rd party help and those other things.